THE SITUATION IN SOUTH VIETNAM(INFORMATION AS OF 1300 EDT)

Created: 9/17/1963

OCR scan of the original document, errors are possible

I NT ELLIGENCE AGENCY

SITUATION IN SOUTH VIETNAM

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THK SITUATION IN SOUTH VIETNAM

(Information as0 EDT)

SUMMARY

Troop*-are somewhat less ln evidence ln Saigon, and the majority of the arrested Buddhists bavebeen released from custody. Our station chief believes, however, tbat prisoners suspected of active plotting or of contacts with the Viet Cong will be kept io Jail, and that the regime will keepsecurity forces in and near Saigon to maintain order and guard against coup attempts.

He notes that tbe crisis has probably made Nbu and Diem more sensitive to outside opinion, more cognizant of tbelr dependence on tbe military, and aware tbat tbey can neither revert fully to the status quo ante nor rely on pure repression to deal with the domestic unrest.

There are continuing reports tbat Nbu may ask for the withdrawal of US advisers and seek anwith Hanoi. General Khiem, chief of staff to the Joint General Staff, sought out an -American source yesterday to tell him that keywill not tolerateeal. He says the generals have asked for several cabinet posts.

The opposition Tuyen group, which has setdates for coups but as yet baa taken no action, now plans to assassinate Diem, Nhu, andalace meeting oneptember.

Madame Nbu has told the press ln Belgrade that she will reacb New Yorkctober, and does not expect to confer with any high officials in Washington. Her intervening travel plans areand the length of ber stay ln the US dependsross-country speaking tour and her "whim."

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I. ASSESSMENTS

1. The CIA Saigon station chief expects that substantial security forces will be maintained in Saigon despite the lifting of martial law, to guard against unrest or possible coup attempts.

He believes tbat most of the Buddhists arrested ln recent weeks now have been released, but tbat prisoners suspected of coup plotting or of connections with the Viet Cong will be kept ln custody.

The station chief comments that Diem and Nhu probably are not as insensitive to US and world opinion as some observers think, and that theyare aware that they can neither revert to the situation as lt existed before tbe Buddhist disorders nor cope with Internal dissatisfaction by pure He also feels the two leaders are aware of their increased dependence on tbe military, while military leaders at the same time are becoming aware of their ability to influence the regime.

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He reports that top US officials in Saigon now consider lt virtually impossible that Diem and Nbu can be separated, or that Uadamo Nhu can bo silenced for any period of time.

has told

Ambassador Lodge that he considers US withdrawal from South Vietnamnd that even the North Vietnamese would be ready to settle for less.

E0that if Hanoi can ob-

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rade agreement assuring it an adequate rice supply from South Vietnam, the DRV would agree to call off the guerrilla war ln exchange for assurances that it would not be attacked by the US. (Comment: North Vietnam's food situation is not so desperate that Its leaders would settle for continued US presence. Such negotiations, furthermore, would provide some delicate moments for the Northwho maintain publicly that they have no control over the Viet Cong guerrillas.)

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THE REGIME

1. Troops remain In evidence In key Saigon population centers such as schools and markets, but have been withdrawn from some government buildings and utilities. The US military attache reports that one of the two airborne battalions on duty ln Saigon has been pulled out. The alert for two other airborne battalions ln the vicinity has been reduced%, but they remain inreserve near Saigon.

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General Khiem, chief of staff to the Joint Generalon 16

iepremDGr during which he stated thageneral officers still are acting "withinhey are increasingly concerned over evidence that Nhu may be negotiating for anwith North Vietnam. Khiem says Nhu has told some general officers (not including Khiem) that Polish Commissioner Manelli has presented afor trade between the two Vietnams which is bolng studied. Nhu reportedly added that both Manelli and French Ambassador Lalouette had offered their services as intermediaries.

Khiem also said the generals have asked Diem for several cabinet posts and were told they would be answered after theeptember election. Khiem claims that if the generals are turned down they will press in "othernd will not go along with Nhu on any program foror accommodation with Hanoi. Khiem considers that he,"General Khanh, and General "Big" Minn constitute the key officer group, and that there have been no leaks ln their contacts with US

3. The assistant army attache has been toldource near Danang that students and faculty at the ARVN artillery school nearby are "veryclaiming that the regime has lost touch with the people. Personnel at the school areto be listening to VOA and BBC as the only available sources of valid news about South Vietnam.

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Nhu has told

pnat after he has "stabilizedwill get rid of US advisara.

u and Madame Nhu have been making public state-ments for some months that there are too many civilian American adlvsers in the provinces, and that some of them should be pulled back toroles or "sent home.

5. Madame Nhu, according to press reports, expects to arrive in New Yorkctober; her plans meanwhile are unclear but apparentlyParis and Morocco. She reportedly plans to stay ln New Yorkeek and then embarkross-country speaking tour. She told reporters ln Belgrade that she does not expect to confer with the President or any other top officials lnand that the length of her US visiton my whim."

THE OPPOSITION

The group associated with formersecurity chief Tran Kim Tuyen now is reported to be planning to assassinate Diem, Nhu, and several ranking generalsalace meeting oneptember. ember of the group who is on the palace staff has demolition equipment.

We cannot judge the capability of this group to carry out such plans, but note that lt has repoatedly set dates for coup action which never materialized. Tho most recent coup date was to have beeneptember, when Tuyen himself was exiled with an assignment as consul general in Cairo. ource later explained this date had been postponed because Nhu left unexpectedly for tho provinces.

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3. South Vietnam's ranking military officer. General Lo Van Ty, who has been under treatment for cancer of the lung at Walter Reed Hospital, will leave for Saigon oneptember. His condition Is reported to be worsening, and it is not clear whether he will resume his position as armed forces chief of staff.

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ANNEX: CIA Reporting on the Political Situation in Southune1 August 63

For several years prior to the outbreak of the Buddhist crisis in3 CIA had believed, and regularly reported to the highest levels ofthat the Diem regime in South Vietnam had serious political liabilities, that it wasinefficient and increasingly unpopular, and that the potential for its overthrow existed.

The DCI, returningisit to South-cast Asia ineported to the Special Group as follows:

Apparently, dissatisfaction with the Diem regime continues as evidenced by Diera's own serious concernoup. Diem family rule, his recent restrictive legislation and concern over security all aredissatisfaction and are contributing factors. oup attempt, whether success- ul or not, would probably adverselythe antl-Vlet Cong effort.

he basic judgmentsuccess was being seriously hampered,precluded, by counterproductive GVNhas been repeatedly spelled out inassessments of South Vietnam CIA hasfollowing paragraphs present the keythe principal such assessments.

National Intelligence Estimates

.a. The question of GVN (Government ofpolitical problemsey issue in debate last winter and spring in the intelligenceproduction ofrospects in South As partpecial procedure employed at that time to "solicit the views of the chiefUSenior CIA officer was sent to Saigon to review the draft estimate on the scene. His team concludedeport disseminated to White House Staff)

We also are concerned over the longer-run prospect for Vietnamese However, we also believe that the difficulties Imposed by the Diem regime are over-stressed when considered in the context of the current situation and we doubt tbat these problems can beat this time withoutossibly fatal setback to the entirein1

The present government bas increased its efficiency and, in any case, is probably no worse and may be better than most of our counter-Insurgency list. Tbls is not to say thatood government by ouris to say that if we expect to get Involved in counter-insurgency situations in fact as well as theory, we must learn how to win with the type of govornments llkeljr to bo found in these countries with such improvements as we can gradually provide.

b. The final HIE, approved by USIBo the outbreak of the Buddhistthat the situation was "fragile":

t can, of course, be argued tbatighly centralized regime, slngle-mindedlyto independence, andeavy emphasis on personal loyalty, can cope with the problems of guerrilla warfare. However, we believereater willingness on tbe part of the regime to enlist the activeof those who have become disaffected or discouraged in tho face of Diem's techniques of government would considerably speod the reduction of tbe Viet Cong insurgency...

But tbe government must be both willing and able to expand its efforts to bring social, political, and economic Improvements to the countryside if the peasant Is totake In the survival of tbe government and to be fortified against Communist Effective action in this and other fields, particularly with the removalubstantial US presence at all levels of the government, would almost certainly require

a wider participation in the development and Implementation of policy and areduction in tbe tight,control of the bureaucracy.

On the basis of its past performance, the ability of the Diem regime to move willingly and effectively ln theseis questionable, and may become even more so should military victory come within sight...

he Situation in focused explicitly on thethe GVN's political stability and viability, and

of OS-GVN relationships. The USIB-agreed SNIE warned ln particular that GVN handling of the Buddhistto date had alreadyocal point for public discontent, and that the GVN would probably proceed to handle the Buddhist issueanner which wouldajor political crisis.

O/NB Memoranda for the42 and ofereto the White Bouse Staff.

October memo concluded thatGVN enlists much more active public supportcause than now exists, we believe that thecannot be reducedoint which willthe bulk of US personnel now committed into be withdrawn."

May memorandum signaled thein GVN sensitivity concerning the growingthroughout South Vietnam, stated thatgained key influence ln GVN affairs andchief source of hostility to the US, andthat.the prospects were not bright forclose US-GVN relationships at all levels.

Current Intelligence Reporting

views of the South Vietnamesewere also implicit In CIA's current Until the Buddhist crisis, however, vulnerabilities of the regime remainednew developments were few, and changespolitical atmosphere were amorphous. Under these

circumstances, the volume of current reporting on Vietnamese domestic politics was relatively small. (Ililitary aspects of the situation were fullythroughout this period). Once events began to move rapidlyesult of the regime'sof the Incidents inherearge volume of current reporting.

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CIA current publications were stating in strong terms the seriousness of the Buddhist crisis, and the threat lt posed to the Diem regime by early June. They continued through the summer to report on this subject.

CIA publications stressed

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unwillingness to come totbe Buddhists.

popular opposition to this

policy.

political orientation of

disruptive influence of the Nhu's.

plotting against the regime.

9. Excerpts from this reporting are attached as an appendix.

APPENDIX

Excerpts from Current Intelligence Reporting

1. Before the incidents in

Current Intelligence Weekly, "'Oppositionists in SaigonParis are plotting Diem's overthrow. Whilewithout South Vietnamese armylittle direct threat to Diem, militaryremain dissatisfied with the President,*'

Intelligence "While individual Vietnamesestrongly pro-American, the government isand feels little kinship with ocal intellectual group hasautocratic and highly centralized rule,government officials have voiced concernin military command and Inadequatehave contributed to growing Viet onstant possibility is theor overthrow of Diem by non-Communistby such groups in cooperation with the Vietbeoup probably requires There is, however, no apparentalternative leader to Diem on the horizon."

Central Intelligence umber of top Southfigures apparently still believe thatsituation requires drastic politicalof the country's three area commanders,stated that the public had lost confidence

in President Diem and his brother Nhu because of their continued toleration of corruption in high circles."

"The overallof the counterinsurgency effortto be blunted by the government's Control measures designed to guardhave hobbled the combat effectiveness

of the military forces. In some areas ineptof counterinsurgency programs hasthe peasantry. The regime's internal image

has also been damaged by Its insensitivity to real or fancied popular grievances or to Issues ofconcern such as corruption."

TheofNhu, President Diem'schief political adviser, appear to be

of the House "With US help,ood chance to contain the However, the Diem government'soperating bave reduced its effectiveness,and militarily. The Diem governmentmany educated Vietnamese, and failedpositive loyalty from its people. It isthat DS involvement can beasting reduction in theachieved so long as present politicalpersist."

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"An outbreak ofsentiment among Buddhists in the majorof Hue*ay could have serious

he Diemof the Buddhist problem so far hasand there is danger of disaffectionsecurity forces."

"The Diemaroused the hostility of Buddhists, whobulk of the

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g. CIB,There are signs that the Diem government intends toirm policy toward Buddhist agitatorsentativeof both sides to end

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i- "Dissension appears to be spreading within the South Vietnamese government. An American observer who recently talked with Nhu received the impression that he would move against Diem if he feels that the regime has become 'servile' to the US."

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